S.Korea Shipyard Workers Willing To End Strike If Legal Action Threat Dropped -unions

Contract workers on strike at Daewoo Shipbuilding & Marine Engineering's (DSME) main shipyard are willing to accept a proposed wage increase if the company drops plans to seek damages, union officials told Reuters on Thursday.

About 100 workers from subcontracters have since late last month occupied the main dock at DSME's shipyard in the south coast city of Geoje, demanding a 30% pay increase and causing delays to deliveries of new vessels from one of the world's biggest shipyards.

In recent negotiations, union officials said they had lowered their demands to a gradual pay increase of 15%, while DSME is holding firm at its offer of a 4.5% rise.

Companies contracted to DSME and union officials continued talks for more than 12 hours on Wednesday but failed to reach an agreement, as damage compensation demanded by the company and its subcontracting firms for losses due to the strike emerged as a key sticking point, according to the Korea Metal Workers' Union (KMWU), which represents the strikers.

"Strikers expressed their intention to accept the 4.5% wage hike offer if the issue regarding damage compensation lawsuits is resolved," said Jang Seok-won, director of public relations at the KMWU.

Lee Kim Choon-taek, a senior official at the sub-contract shipyard workers' union, also said that workers' willingness to compromise depended on DSME and subcontracting companies dropping any plans to seek damages, though there had been no notice yet of lawsuits launched against them.

The subcontracting companies had seemed willing to consider dropping the lawsuits seeking damages but subsequently changed their stance, the union official added. DSME, which participated in previous negotiations, did not attend the talks on Wednesday between subcontracting companies and the workers.

The company has not filed lawsuits against the strikers but plans to do so in the future and does not plan to back down on this, Yonhap news agency reported, citing a DSME official.

South Korean President Yoon Suk-yeol on Thursday morning urged the contract shipyard workers to end the strike, which the government has said violates South Korea's union laws.

"Illegal actions should be resolved swiftly and normalised ... for everyone's good," Yoon told reporters in Seoul.

South Korea's third-biggest shipbuilder said the dispute had cost it more than $400 million as of mid-July.

The construction of eight vessels at five docks at the shipyard is being affected, with delivery dates pushed back by two to five weeks as of Wednesday, a DSME spokesperson said.